I know in the US, public colleges and unis are given their designations by the states (and rules vary by state), possibly in some sort of conjunction with one or more education certification organizations. Private ones seem to select whatever title works to bring in the most applicants in the local environment.

I've got no idea how this works inside of China, but hope someone who does will share. Then I'll be able to decide if I'm opening Lunatic College or the University of Lunacy.